Chandy said liquor outlets will be reduced by 10 percent each year, eliminating sales entirely within 10 years. Beginning next year, bar licenses will be issued only to five-star hotels, while many of the state's 720 bars and restaurants will not have their licenses renewed.

"We are hoping to implement total prohibition in a phased manner," Chandy told ucanews.com.

Kerala has India's highest annual per capita alcohol consumption, with annual sales reaching US$ 415 million. In announcing the ban, state officials said that alcohol abuse was becoming a widespread problem in the state.

The president of the Indian bishops' conference, Cardinal Baselios Cleemis (Isaac) Thottunkal, congratulated Chandy for "his bold steps toward making the state liquor-free".

Cardinal Thottunkal, head of the Syro-Malankara Catholic Church, met the chief minister soon after the decision was announced, to hand him a US$1,600 check for a new fund created to assist workers employed in the state's liquor stores.

The cardinal said Church leaders have been requesting a ban on alcohol sales for several years.

"Now the government in its wisdom has taken a proactive decision to save Kerala. It's a historic decision and we welcome it," Cardinal Thottunkal told ucanews.com.

Archbishop Maria Callist Soosa Pakiam of Trivandrum, who was at the forefront of an anti-liquor campaign, told ucanews.com the ban will bring "great relief for millions of families who suffer due to alcoholism".

However, opposition leader V S Achuthanandan criticized the decision.

"If the government wants to implement total prohibition why is it opening bars in five-star hotels?" Achuthanandan asked ucanews.com.

Tourism officials complained the ban will have a negative affect on the tourism sector.